diff --git a/src/Microsoft.DotNet.Interactive.Tests/VariableSharingTests.SetMagicCommand.cs b/src/Microsoft.DotNet.Interactive.Tests/VariableSharingTests.SetMagicCommand.cs
index 9c57c87134..3fc65729ff 100644
--- a/src/Microsoft.DotNet.Interactive.Tests/VariableSharingTests.SetMagicCommand.cs
+++ b/src/Microsoft.DotNet.Interactive.Tests/VariableSharingTests.SetMagicCommand.cs
@@ -494,6 +494,43 @@ public async Task value_option_is_required()
                    .Which.Message.Should().Be("Option '--value' is required.");
         }
 
+        [Fact]
+        public async Task ProxyKernels_sharing_values_receives_them_as_deserialized_values()
+        {
+            using var localCompositeKernel = new CompositeKernel
+            {
+                (new CSharpKernel()).UseValueSharing()
+            };
+            using var remoteCompositeKernel = new CompositeKernel
+            {
+                (new FSharpKernel()).UseValueSharing()
+            };
+
+            ConnectHost.ConnectInProcessHost(
+                localCompositeKernel,
+                remoteCompositeKernel);
+
+            await localCompositeKernel
+                .Host
+                .ConnectProxyKernelOnDefaultConnectorAsync(
+                    "fsharp",
+                    new Uri("kernel://remote/fsharp"));
+
+            await remoteCompositeKernel.SendAsync(new SubmitCode("let x = 123"));
+
+            var result = await localCompositeKernel.SendAsync(new SubmitCode("""
+                #!set --name x --value @fsharp:x
+                x
+                """, targetKernelName: "csharp"));
+
+            result.Events.Should()
+                .ContainSingle<ReturnValueProduced>()
+                .Which
+                .Value
+                .Should()
+                .Be(123);
+        }
+
         private static Kernel CreateKernel(Language language)
         {
             return language switch
diff --git a/src/Microsoft.DotNet.Interactive/Connection/ProxyKernel.cs b/src/Microsoft.DotNet.Interactive/Connection/ProxyKernel.cs
index 7ec9a779be..f0972006da 100644
--- a/src/Microsoft.DotNet.Interactive/Connection/ProxyKernel.cs
+++ b/src/Microsoft.DotNet.Interactive/Connection/ProxyKernel.cs
@@ -98,7 +98,6 @@ private Task HandleByForwardingToRemoteAsync(KernelCommand command, KernelInvoca
                 return Task.CompletedTask;
             }
         }
-
         var targetKernelName = command.TargetKernelName;
         if (command.TargetKernelName == Name)
         {
@@ -128,6 +127,7 @@ private Task HandleByForwardingToRemoteAsync(KernelCommand command, KernelInvoca
         {
             command.TargetKernelName = targetKernelName;
 
+
             if (te.Result is CommandFailed cf)
             {
                 context.Fail(command, cf.Exception, cf.Message);
diff --git a/src/Microsoft.DotNet.Interactive/KernelExtensions.cs b/src/Microsoft.DotNet.Interactive/KernelExtensions.cs
index 56b776d811..5a4dd958de 100644
--- a/src/Microsoft.DotNet.Interactive/KernelExtensions.cs
+++ b/src/Microsoft.DotNet.Interactive/KernelExtensions.cs
@@ -173,51 +173,29 @@ private static async Task HandleSetMagicCommand<T>(
 
             var valueOptionResult = cmdLineContext.ParseResult.GetValueForOption(valueOption);
 
-            // FIX: (HandleSetMagicCommand) 
-
-            switch (events.Count)
-            {
-                case 0: break;
-                case 1: break;
-                case 2: break;
-                default: break;
-            }
-
-            if (valueOptionResult is { })
-            {
-                if (valueOptionResult.Kernel is { } sourceKernelName)
-                {
-                    switch (sourceKernelName)
-                    {
-                        case "input": break;
-                        case "password": break;
-                        default: break;
-                    }
-                }
-                else
-                {
-                }
-
-                if (valueOptionResult.Kernel is { } sourceValueName)
-                {
-                }
-                else
-                {
-                }
+            var sourceKernel = Kernel.Root.FindKernelByName(valueOptionResult.Kernel);
+
+            ValueProduced valueProduced;
+            if (
+                sourceKernel?.KernelInfo.IsProxy == false
+                && valueOptionResult is { Name: var sourceValueName, Kernel: var sourceKernelName } 
+                && sourceKernelName != "input")
+            {
+                valueProduced = events.SingleOrDefault(e =>
+                    e.Name == sourceValueName && e.Command.TargetKernelName == sourceKernelName);
+            }else if (sourceKernel?.KernelInfo.IsProxy == true 
+                      && valueOptionResult is { Name: var sourceValueName1 })
+            {
+                var destinationUri = sourceKernel?.KernelInfo.RemoteUri;
+                
+                valueProduced = events.SingleOrDefault(e =>
+                    e.Name == sourceValueName1 && e.Command.DestinationUri == destinationUri); 
             }
             else
             {
+                valueProduced = null;
             }
 
-            var valueProduced = valueOptionResult switch
-            {
-                { Name: var sourceValueName, Kernel: var sourceKernelName } when
-                    // !string.IsNullOrWhiteSpace(sourceKernelName) &&
-                    sourceKernelName != "input" => events.SingleOrDefault(
-                        e => e.Name == sourceValueName && e.Command.TargetKernelName == sourceKernelName),
-                _ => null
-            };
-
             if (valueProduced is { })
             {
                 var referenceValue = isByref ? valueProduced.Value : null;
@@ -382,7 +360,7 @@ ValueOptionResult ParseValueOption(ArgumentResult argResult)
                 requestValue = new RequestValue(sourceValueName, JsonFormatter.MimeType, sourceKernelName);
                 isByref = false;
             }
-
+            
             var result = destinationKernel.RootKernel.SendAsync(requestValue).GetAwaiter().GetResult();
 
             if (result.Events.LastOrDefault() is CommandFailed failed)